ITC posts marginal growth in Q2

ITC is a FMCG private sector company. ITC has a market presence in Cigarettes, Hotels, Paperboard's & Specialty Papers, Packaging, Agri-Business, Packaged Foods & Confectionery, Information Technology, Branded Apparel, Personal Care, Stationery, Safety Matches and other FMCG products.

Cigarette-to-hotel-FMCG major ITC released its July-September quarter earnings, wherein the revenue of ITC marginally increased by 3.69 per cent to Rs 8904.23 crore in Q2FY16 as against Rs 8587.7 crore in Q1FY16. Its Cigarette segment revenue rose by 4 per cent to Rs 4317.18 crore, Hotel segment revenue grew by 0.77 per cent to Rs 290 crore, Agri Segment revenue declined by 20.71 per cent to Rs 1843.7 crore and Paper Packaging segment revenue reduced by 0.8 per cent to Rs 1254 crore on sequential basis.

Marginal increase in its total expenses by 2.62 per cent to Rs 5603 crore Q-o-Q basis. The EBITDA grew by 5.15 per cent to Rs 3560 crore , EBITDA margin expanded by 56 basis points to 39.98 per cent on sequential basis. Margin expansion was led by cigarette business (contributes 48 percent to total revenue) & agri business (contributes over 20 percent to revenue), and also boosted by lower raw material cost.

The other income of ITC rose by 26.73 per cent to Rs 399.2 crore, the tax expenses increased by 7.89 per cent to Rs 1258.9 crore on quarterly basis. Net profit rose to Rs 2431 crore in Q2FY16 from Rs 2265.4 crore in previous quarter of same fiscal, up by 7.32 per cent, impacted by slow revenue growth in cigarette business, weak revenue growth in agri business, hotels and paper business but the strong margin expansion and other income helped profit rise marginally.

The FII holdings of ITC increased by 524 basis points to 20.71 per cent, DII holdings reduced by 512 basis points to 35.1 per cent as on Quarter ending 30th September 2015. Today, after the result announcement ITC closed at Rs 335, around 4 per cent lower on BSE.